Yesterday's bullish close at the day's highs seemed surprising, but today's sell off into the close was all too familiar. From about noon on, the markets steadily traded lower. The Beige Book didn't seem to affect the market one way or the other. RUT ran as high as $632 before falling to a close at $618, up less than a dollar for the day. SPX also traded up in the morning to $1078 but then gave up all of its gains to close down $6 at $1056. This is the low previously set in February this year and touched again on May 21. Will it bounce off that support level? Today's trading action was certainly bearish in tone; when the market can't hold its highs, it is a bad sign. But yesterday's trading patterns were bullish, so perhaps this is the look of a sideways consolidating trading pattern - some analysts would call it building a base. Trading volume dropped across the board, with a 3% drop on the NYSE and a 14% decrease on NASDAQ; the S&P 500 stocks dropped to five billion shares traded, right at the 50 day moving average.

I removed the July hedges on my June condor this morning, and the sell off this afternoon pushed this position back to a weak spot with a position delta of+$126 and position theta of +$307; the theta/delta ratio is strong, but that large delta translates to large price risk with further drops in RUT. The July iron condor on RUT moved into the black with the drop in IV and stands at a position delta of +$27 and position theta of +$72. So July is doing well but June is teetering on the edge.